The need for insurance

Thinking about insurance is boring but necessary but try to think of it as a security blanket, something slightly cuddly that should make you sleep better at night in your new life after divorce..

Insurance is there to help you cope when the nasty stuff in life happensBecause unexpected and unpleasant things can happen when you least expect them to, you need the peace of mind that insurance can bring.

Being divorced means that you only have one salary or income stream coming in to cover eventualities and if you fail to take out adequate cover then you could find yourself facing a hefty bill that you may be unable to pay.

Most of us are concerned with three major areas when it comes to taking out insurance – that relating to our house, our car and our life. The first two you have to insure and the third is a very good idea. If you have just been divorced you will have dozens of other things to think about but don’t ignore getting, and keeping, yourself adequately covered.

Is insurance really necessary? Insurance will help you protect yourself and your belongings against unforeseen, unfortunate events and the insurance company will pay an agreed amount to cover any damage. In some cases insurance is an option such as that for house contents and it is up to you if you are willing to take a chance that your home may not be burgled or subject to damage from a leaking washing machine for example. Some insurance, such as motor insurance is not optional.

Insurance companies will assess the amount of money – the premium - you need to pay for a particular type of insurance on the information you give them such as where you live or your age and the type of insurance you require. It is important that you give the correct information when buying insurance as giving the wrong information could affect any claim you might make.

Most car insurance policies will specify an excess. For example; if you are making a claim for three hundred pounds you pay the first £50 and the insurance company will pay the remaining £250. The excess amount will vary with different policies.

Price comparison sitesInsurance is a very competitive market and the rise of internet comarison sites has added further choice and complexity. It is wise to bear in mind that that they are not totally independent as they do take fees from the insurance companies. Use them as a guide but not as the absolute truth. Remember just because it's the cheapest it might not be the best value for your needs.

Financial Concuct Authority This is the body that generally, but not always, regulates firms selling insurance and those providing the cover i.e. underwriting the risk. Exceptions include travel agents selling insurance to travellers. Before you hand over money to anyone involved in selling or underwriting insurance you might want to check that they are on the FCAregister.

If a company is not registered and something goes awry you will not have access to complaints and compensation procedures.

Useful tips When you receive your policy read the small print and be aware of any exclusions or restrictions that could affect any claim you may make. You are not under any obligation to take out the insurance offered by your mortgage company or with a travel agent when booking a holiday as they will often be more expensive than independent providers. Make yourself familiar with the procedure for making a claim and keep your documents in a safe place where they be easily and quickly accessed.